Surfactant protein C (SP-C), a 35 amino acid lung-specific hydrophobic peptide, enhances the biophysical activity of surfactant phospholipids. SP-C is synthesized as a 21 kD pro-peptide (proSP-C21) and post- translationally processed to yield the 3.7 kD surface active alveolar form by cleavage of NH2- and COOH- flanking peptides and addition of covalently bound palmitic acid. The importance of SP-C to surfactant function is underscored by several observations: 1) Replacement surfactant containing recombinant SP-C as the sole protein possesses biophysical properties similar to natural surfactant; 2) Respiratory failure associated with almost undetectable levels of mature SP-C occurs in term Belgian White/Blue calves; 3) Lethal deficiency of SP-C in human neonates has been reported; 4) Allelic expression of mutations in the SP- C gene in humans has been associated with chronic lung disease, accumulation of unprocessed SP-C precursors, and selective absence of mature SP-C. Thus, both the absence of mature SP-C as well as the expression of abnormal forms of SP-C is associated with surfactant dysfunction and lung injury. The overall goal of this project is to further understand the molecular mechanisms underlying SP-C biosynthesis and to assess the consequences of mutant SP-C expression in the pathophysiology of lung disease. The experimental approach involves both reductionist and integrative approaches to dissect key elements in the targeting and post-translational processing of pro-SP-C in the secretory pathway. Intracellular trafficking and definition of targeting motifs will first be characterized in a transfected cell line (Specific Aim 1) and then extended to both an in vitro isolated, differentiated type 2 cell model and to an in vivo mouse model using adenovirus mediated transfer of tagged SP-C constructs (Specific Aim 2). The role of specific proteases will be defined using both in situ and in vitro assays (Specific Aim 3). Transgenic mouse models will be generated to assess long-term effects of mutant proSP-C expression (Specific Aim 4). This approach will permit characterizing of SP-biosynthesis in the presence and absence of endogenous SP-C and in the context of both single cells as well as the whole animal.